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Yahoo
3 days ago
- Business
- Yahoo
Gold prices risk 'blow-off top' like 2011
Gold prices risk 'blow-off top' like 2011 originally appeared on TheStreet. Carley Garner is a long-time futures trader who has seen a thing or two over a career that has lasted over 20 years, including gold market rallies and sell-offs. The massive rally in gold stocks this year to north of $3,357 per ounce has caught her attention, and not in a good way. Invest in Gold Thor Metals Group: Best Overall Gold IRA Priority Gold: Up to $15k in Free Silver + Zero Account Fees on Qualifying Purchase American Hartford Gold: #1 Precious Metals Dealer in the Nation Gold prices are up over 28% year-to-date in 2025, and the size and speed of the move (and the reasons behind it) remind her of a similar rally 14 years ago in 2011. Back then, the outcome for gold bugs wasn't fun. "The 2011 top was met with a 45% haircut that took nearly a decade to recover," according to Garner. Why gold rallied so much this year Gold has enjoyed a perfect storm this year as macro crosscurrents hamstring the Fed's monetary policy, GDP slips, and the U.S. debt outlook worsens. Unemployment has risen to 4.2% from 3.4% in 2023, CPI inflation of 2.7% is stubbornly above the Fed's 2% inflation target, the World Bank says GDP is expected to fall to 1.4% from 2.8% last year, and debt experts say the One Big, Beautiful Bill Act passed this year will add $3.4 trillion to the U.S. debt by risks have hammered the US Dollar, causing the Dollar Index to tumble 10% in 2025. Since gold is priced in USD, the Dollar's struggles have made it more attractive to overseas buyers eager to diversify their holdings away from U.S. Treasuries in protest of President Donald Trump's tariff policy. The significant uncertainty has also made antsy investors far more interested in gold than Treasuries as a safe haven. "Safe haven dollars can purchase gold, an asset that doesn't produce income, at an all-time high without a risk parachute, or they can buy Treasuries at multi-decade lows with a yield of 4% to 5% to cushion downside price risk," said Garner in a TheStreet Pro post. "Ironically, the masses select the former and pass on the latter." Many are indeed giving up on Treasuries' relatively juicy yields, fearing the worst. That may not be the best move, though, for newer gold bugs, given that gold has already rocketed to all-time highs this summer. Gold's rally echoes the past Troubling times always increase interest in gold, and this isn't the first time that gold has put on a show. In 2011, gold similarly rallied sharply to all-time highs amid uncertainty around major banks and the economy, and aftershocks following the Great Recession, which was still fresh on investors' the S&P cut the U.S. debt rating for the first time in history in August 2011 because of the growing deficit, prompting a massive 5.5% drop in the S&P 500 on Aug. 8. The situation was so bad that Warren Buffett famously back-stopped Bank of America on Aug. 25, providing a cash influx in exchange for preferred stocks and warrants that eventually made Buffett's Berkshire Hathaway a mint when risk assets found their footing and gold lost its luster. "Although gold is known as a safe-haven asset, it has a history of stunning corrections," reminded Garner. "For instance, the 2011 top was met with a 45% haircut that took nearly a decade to recover." Is gold still worth buying now? Like most investments, momentum can drive assets higher and lower than logic may dictate, making betting against it a risky endeavor. Still, most money is made or lost by acting ahead of the turning points that mark tops and bottoms. Given that gold has already made a major move higher, investors are wise to consider whether we're closer to a top like 2011 than a bottom like a few years ago. More Experts: Stocks & Markets Podcast: Sectors to Avoid With Jay Woods Trader makes bold call with Boeing stock after defense workers strike Veteran fund manager sends urgent 9-word message on stocks "Gold is an asset that should only be bought when nobody wants it. If everyone is buying it, it's probably too late for anyone with a time horizon of less than a decade or longer," said Garner. There's certainly an argument that gold bullishness is widespread, with many talking positively about it as a hedge worth owning. "If you are looking for bearish analyst calls or news, you won't find it," said Garner. "But don't let this detract you from being skeptical." Gold was panned as a "dead dog acting as a drag to portfolios" three years ago, says Garner. Today, she says, "it is considered a must-hold in those same portfolios." In other words, contrarian thinking, akin to buying when everyone is selling and selling when everyone is buying, may make more sense today regarding gold than three years ago. "Just as conventional thinking was misguided then, it might be wrong today," wrote prices risk 'blow-off top' like 2011 first appeared on TheStreet on Aug 16, 2025 This story was originally reported by TheStreet on Aug 16, 2025, where it first appeared.
Bloomberg
06-08-2025
- Business
- Bloomberg
Bulls Get Another Reason to Worry as Sentiment Gauge Flashes Red
Stock bulls have another reason to worry that the blistering rally in American equities may be about to cool. The Bloomberg Intelligence Market Pulse Index pushed to a 'manic' reading last month, a sign that investor exuberance may be running too hot. The measure combines six metrics like market breadth, volatility and leverage to deliver a reading on investor sentiment. When it gets into overheated territory, returns tend to weaken in the following three months.
Bloomberg
01-08-2025
- Business
- Bloomberg
Japan Retail Traders Pile Bearish Nikkei Bets, Raising Doubts
As Japanese stocks soar to record highs, retail investors are ramping up bearish bets, highlighting lingering doubts about the rally's staying power. The contrarian tilt, long embedded in the behavior of Japanese individual investors, is surfacing yet again. Some analysts trace the mindset back to decades of equity market underperformance driven by yen strength and deflation.
Reuters
24-07-2025
- Business
- Reuters
Ameriprise Financial's quarterly profit rises on higher fee income
July 24 (Reuters) - Asset and wealth manager Ameriprise Financial (AMP.N), opens new tab reported a 28% rise in its second-quarter profit on Thursday, as a late-quarter market rally boosted the value of its fee-generating assets to a record high. After a turbulent start to the quarter because of U.S. President Donald Trump's shifting tariffs, the markets regained poise on hopes of a softer trade policy and positive macroeconomic data. Ameriprise's assets under management, administration and advisement came in at $1.58 trillion during the three months ended June 30, up 9% from a year ago. "While markets were volatile in the quarter, client activity remained strong," chairman and CEO Jim Cracchiolo said in a statement. Assets under management and the fees earned by managers depend on two factors - money flowing in and out of the funds and the performance of investments. Ameriprise's management and financial advice fees rose 6% to $2.6 billion during the second quarter, while its net investment income dropped 3% to $891 million. Total client assets at its advice and wealth management business, which primarily targets high net-worth households with $500,000 to $5 million in investable assets, grew to $1.08 billion from $972 million a year earlier. However, the unit posted a 35% fall in quarterly net flows. Rival BlackRock (BLK.N), opens new tab also reported a fall in long-term net inflows last week, after a major Asian institutional client pulled money from an index strategy. Ameriprise's second-quarter profit rose to $1.06 billion, or $10.73 per share, compared with $829 million, or $8.02, a year earlier.
Free Malaysia Today
09-06-2025
- Business
- Free Malaysia Today
Asian markets rally ahead of latest China-US trade talks
The Hong Kong stock market rose more than 1%. (AP pic) HONG KONG : Stocks rallied today on hopes that a fresh round of China-US trade talks later in the day will ease tensions between the economic superpowers, while investors were also cheered by forecast-topping US jobs data. The gains extended a run-up across global markets in recent weeks as fears about Donald Trump's tariff blitz subsided and countries made deals with Washington. All eyes are on London, where top officials from China and the US are due to meet for more negotiations aimed at preserving a fragile truce agreed last month that slashed eye-watering tit-for-tat levies. The talks come days after Trump and Chinese counterpart Xi Jinping held their first publicly announced telephone talks since the US president returned to the White House. They were helped by news that Beijing had on Saturday approved some applications for rare-earth exports, while plane giant Boeing will start sending commercial jets to China for the first time since April. Optimism that the two sides will make a breakthrough boosted Asian markets, with Hong Kong up more than 1%, while Tokyo, Shanghai, Seoul, Singapore, Taipei and Manila also advanced. The gains followed a strong lead from Wall Street, where all three main indexes closed more than 1% higher after figures showing the world's largest economy created a forecast-beating 139,000 jobs last month. While the figures for the previous two months were revised down, the data indicated that the economy remained robust, and tempered worries sparked by Wednesday's report by payroll firm ADP showing a big miss on private hiring. Eyes will now turn to the Federal Reserve (Fed) as it decides whether to lower interest rates, with many economists warning that Trump's tariffs could reignite inflation, hit supply chains and drag on consumer sentiment. 'The May minutes and recent comments by several (policy board) members… suggest the Fed is highly attentive to the risk that tariffs will lead to a persistent inflation shock,' wrote analysts at Bank of America. 'Those risks could come into focus for markets by the fall,' analysts said. Michael Hewson at MCH Market Insights remained positive for the outlook for the US economy. 'For now, the US economy continues to look reasonably resilient although the recent ADP jobs report showed some evidence of a slowdown in May,' he said in a commentary. 'However on the whole there is little sign that the economy is on the cusp of an economic shock at the moment, despite the unpredictable nature of the current US administration,.' Hewson added.
